The success of an organization in today’s competitive world depends upon how well it embraces the challenges of diversity and realizes its benefits. Employees from different backgrounds, ages and ethnicities bring their own set of experiences and world views, and are better able to provide a wider range of solutions to developing problems. Most of all, a lack of diversity has been linked to increased discrimination which in turn leads to elevated stress levels among employees. The National Center for Biotechnology Information note that discrimination due to immigrant status, legal status, skin tone or language can contribute to increased stress in individuals.

So how do companies deal with the diversity in the workplace? U.S. companies spend millions of dollars every year on diversity programs and policies, ranging from equal employment opportunity compliance to cultural sensitivity training programs. This leads most people to assume that it makes companies fairer to both women and minorities; the reality is much different, however. Implementing diversity program has little actual positive effect and may even decrease representation according to the Harvard Business Review. Even when there is clear evidence of discrimination, the mere presence of a diversity policy automatically leads people to discount any claims of wrongdoing.

This leads to increased stress levels and with long-term discrimination can lead to acute and chronic stress. The body enters a defensive posture which closes our ability to learn and impairs judgement. Statistics Canada states that over one in four workers report being highly stressed and over 62% of workers reported that work is the main source of stress in their lives.Lottoland describes this kind of stress as ‘distress’, which could be permanent, prevents the body from coping, is demotivating and decreases productivity. As opposed to ‘eustress’ which is a euphoric stress that can actually motivate, increase productivity and make us feel excited. Strong leaders create a stress-free environment where people do not need to get into that kind of defensive posture.

Diversity should be a critical component of the innovation that leaders strive to achieve in their organization, and research shows that diverse groups outperform homogenous ones. Research conducted by Credit Suisse focusing on 2,400 companies, found that organizations with at least one female board member yielded higher returns on equity and net income growth than those who did not employ women on their board. Working with people from different backgrounds than you will challenge your brain to think more diversely and expand your horizons. The effect of this relationship is that the brain is happier which in turn lowers stress levels and makes a person generally happier as well.

Workplace diversity can, however, have some unwanted effects which leaders must manage effectively by promoting diversity of thought and innovation. Here at Journey to Diversity Workplaces we say that diversity brings about a variety of ethical issues like sexual harassment due to sexual orientation, racism and gender bias. These are critical situations that interfere with work, personal lives and cause high levels of stress both in the workplace and at home. Particularly in a company that is lacking gender and racial diversity these unwanted effects can be more pronounced. A good leader, therefore, must be fair to manage diversity effectively and when employees enter that stressful phase, the leader must be able to pull them out if it. When people experience fair treatment and a positive and genuine diversity, it will in turn reduce their stress levels and improve their health.